Gregg and Evan Spiridellis grew up as brothers in New Jersey sharing a sense of humor but seemingly little else.
Gregg worked on Wall Street and received an MBA from Wharton.
Evan became an artist and independent filmmaker.
Nearly 18 years ago, they went into business together, investing $5,000 each, renting a friend's garage and doing something that seemed crazy: They started an internet business sending animated videos over phone lines.
"All of our files had to be under 100K, which is a tenth of one megabyte," said Evan. "That's smaller than your average banner ad on a website, by the way," added Gregg.
They called the business JibJab, a name Gregg came up with. "We wanted it to be two syllables so it sounded punchy and fun."
The birth of an idea
Gregg was always on the lookout for opportunities, and while he was at Wharton, he discovered Flash.
"There was something about it," he said. "Seeing a piece of animation or a cartoon streaming over a phone line triggered something in my head."
He called his brother and suggested that instead of making films the traditional way, "now we could actually make something with just a few thousand dollars' worth of equipment and distribute it all around the world."
"It didn't take a ton of convincing," Evan said. "He showed me the opportunity, and I saw it."
Bypassing the media middleman to put content online soon made the brothers famous. "This became a really hot space," said Gregg. Hollywood directors like Ron Howard and Steven Spielberg wanted to create entertainment for the internet. "Because we had been doing it for, like, six weeks, we were experts."
JibJab started making money producing projects for studios like Disney and Sony, using the profits to build their own business (one of their earliest characters was a crotchety Kris Kringle they named Nasty Santa).
"We caught the beginning of a wave," said Gregg, "a wave that ultimately crashed in 2001."
Surviving the crash
To avoid going under after the internet bubble burst, the Spiridellis brothers decided to turn Nasty Santa into a physical toy. They learned that Spencer Gifts was having an event where people could pitch products. Evan made a Nasty Santa drawing, and Gregg went online to find manufacturers (searching with Alta Vista, because this was pre-Google).
They asked manufacturers to bid on making the doll. "We said we have an order for 5,000 units," Evan recalled. "Meanwhile, we had no order!"
The day before the retail event, several Nasty Santa mockups arrived, and they chose their favorite to take to Spencer Gifts. "We got an order for 5,000!" said Gregg. "They said, 'Can you ship that FOB Hong Kong?' And I said, 'Sure, absolutely!' I walked out of there and I called my friend, and was like, 'Do you know what FOB Hong Kong is?'" Gregg learned it meant "freight on board."
Nasty Santa hit the market in 2001, and by 2002, Spencer Gifts expanded it from one line of products to 12. JibJab moved to Los Angeles, downsized from 13 employees to just Gregg and Evan, and scraped by.
"We just set up shop here," said Gregg. "We started making more toys, and we started doing children's books, and kept investing in the internet but at a much slower pace."
'This Land'
Just when the brothers thought perhaps entertainment would never make money on the internet, they hit pay dirt. In 2004, they created a political animation for the election called "This Land," a parody of George W. Bush and John Kerry.
"It just blew the socks off of everything that we had done before," said Gregg.
"We went within a week from wondering if we're going to have to go out and get real jobs, to being on the set of 'The Tonight Show,' the 'Today' show," said Evan.
They started making money by charging people to download their videos, then Trivial Pursuits and Topps trading cards called. Evan said Gregg got an idea the night before appearing on "Today" that they should sell DVDs of their videos. "So he set up a Yahoo store, designed a cover, and printed it on the Epson overnight!" They slipped the cover into an empty CD case and held it up on the air during an interview with Matt Lauer.
"We were very upfront about it on the website," said Gregg. "It said, 'We will ship it to you in six to eight weeks,' because we figured that in six to eight weeks we could figure this out."
In a single day they sold $100,000 in DVDs.
Success at last
Since then, the company has raised $17.9 million in funding and hired 70 employees, with hundreds of artists under contract. JibJab has a million subscribers to its personalized e-card service, cards that often involve stop-action photography and can cost as much as $100,000 for one card. The company has expanded into messaging, emojis, and now a television program called "Ask the StoryBots."
Gregg said they've been successful because they've always tried to identify and exploit new channels of communication. But the brothers also insist on doing things their way. For example, JibJab spent millions of dollars of its own money producing "Ask the StoryBots" without knowing whether anyone would buy it.
"We did the dumbest thing that anyone could ever do in Hollywood, and that was finance your own show," Gregg said. "We knew we'd sell it."
They did. To Netflix. On YouTube, StoryBots videos have more than 300 million views.
Last year JibJab revenues were "well over" $20 million. Next, the brothers are thinking of expanding into augmented reality, where characters pop up in an environment along the lines of "Pokemon Go" ("without kids running into the street").
It's been a long road to success, but worth it. "When I was in investment banking ... I was passionate about what I was doing," said Gregg. "But when I look back, there were a lot of people who were 35 and looked 85 and had lots of money but no time."
They've turned down many opportunities along the way, opportunities that might have made them bigger faster, but the brothers have no regrets.
"Our job is to make people laugh," said Evan. "We get to make stuff that we love, no one really gets to tell us what to do, and hopefully we bring a little happiness into the world."
